Once again Amazon has shaken up the physical side of retail with the opening of its Amazon Go store, featuring no checkouts and no cashiers, rather relying on a combination of sensors, computer vision and machine learning to keep track of what’s taken off and returned to shelves.
The Amazon Go store, currently in beta and open only to Amazon employees, is expected to open to the public early in 2017.
The RTP editorial team discusses the potential impacts Amazon Go will have on the retail industry going forward, particularly implications on the labor force and in-store technology deployment. The editors also forecast how far Amazon will be able to scale the “Just Walk Out” technology.
Debbie Hauss, Editor-In-Chief: Apple already is doing this via its app, starting in 2011. They’ve avoided losses from shoplifting, in part, by internally locking down computers. This strategy definitely has pros and cons and should be considered on a case-by-case basis. It definitely adds shoplifting risks, so retailers may be trading cashiers for security guards. As consumers, I think we all would appreciate the opportunity to avoid the line at CVS, Costco, Macy’s, the supermarket, etc., so I see where Amazon is headed with this. Also, Amazon needs a unique niche to be successful with brick-and-mortar stores. The marketplace already mostly sells other companies’ brands, so that’s not a unique brand proposition. Just like mobile payment, if the technology is not simple to use and adds time or steps to the checkout process, consumers will not be likely to embrace it.
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Adam Blair, Executive Editor: Just about every time Amazon comes out with another mind-blowing innovation, I say in our editorial meetings that at least part of the retailer’s motivation is “Jeff Bezos messing with traditional retailers’ heads.” But in addition to the shock/PR value of Amazon Go, the store and its technology are likely to have far-reaching effects beyond disturbing the sleep of brick-and-mortar executives. As ZDNet points out, even if Amazon doesn’t open hundreds or thousands of these stores, it’s likely to tie some elements of the “Just Walk Out” technology into its Amazon Web Services once the company has worked out all the kinks. Other solution providers will do their best to compete. That means there won’t be mass firings of cashiers, but simply an acceleration of the automation that is squeezing these jobs out of existence. That’s of concern because according to the Bureau of Labor Statistics, 3.4 million people work as cashiers in the U.S. Retail and other service jobs have been one of the prime growth areas for employment during the Obama years, and despite the President-elect’s promise to bring back manufacturing jobs, it’s likely to remain an important economic engine. I don’t believe in standing in the way of progress, but someone had better figure out where new jobs are going to come from in the 2020s.
David DeZuzio, Managing Editor: Within hours of announcing Amazon Go, the world positioned the e-Commerce titan’s concept as a dystopian brick-and-mortar retail nightmare that will plunge the world into a jobless, robot-led wasteland. After a few days to think it over, cooler thinking has prevailed. Ultimately, I don’t think Amazon Go will kill human interaction entirely, but it may slowly choke it out by severely restricting the number of entry-level retail jobs. Go locations will still need a customer service representative or two to address exchanges, improper charges or other technical glitches and perhaps a shelf stocker or two. I wouldn’t bet the organic, locally sourced farm on either one of those positions being available frequently or for long, but let’s keep the overall perspective of Go as an incremental change. In fact, Gartner predicts that by 2020, 85% of customer interactions will be managed without a human and at the close of 2018, customer digital assistants will recognize customers by face and voice across channels. Amazon denies it will be opening 2,000 stores anytime in the near future, but if it is able to scale the “Just Walk Away” technology, which is almost certain, I’m guessing Gartner’s 85% might be a lowball figure. Amazon Go may not be the immediate job killer everyone thinks, but make no mistake, the future of retail is heading in this direction. Let’s put it this way — would you tell your kids to get into retail as a solid career choice? I didn’t think so. On the bright side, no retailers closed their doors due to the Go announcement, so it will be interesting to see how companies like Sephora, Best Buy and smaller, disruptive retailers will try to beat Amazon at its own game.
Glenn Taylor, Senior Editor: Like any other disruptive technology introduction, the Amazon Go reveal was always going to garner an outrageous reaction. We saw it with beacons a few years ago, and even with Amazon’s drones around the same time. It’s a pilot that is creating an experience that hasn’t been introduced on a full scale anywhere else, so speculation naturally follows. But we still don’t know the effectiveness of the technology in practice, so people shouldn’t necessarily be fearful of the cashier job well drying up anytime soon. At this rate, I still don’t have faith in many stores (particularly in grocery) being able to effectively integrate comparable technology, so I don’t think the job market will be affected for quite some time. If the pilot is successful, other tech-savvy brands will likely catch on with their own slow rollouts in select locations. The camera and microphone-driven technology may actually have practical use in assisting cashiers for now so that they can identify and scan items faster, so I wouldn’t rule out the possibility of this tech working in conjunction with store employees.
Alicia Esposito, Content Strategist: Another day, another news headline featuring Amazon. Why? Because Amazon does such damn cool things! I was chatting with a retail exec contact of mine, and he compared this development to Amazon’s drone unveiling. Super cool, headline grabbing, but it’s highly unlikely that it will be widely adopted in the near future. And you know what, that’s totally fine. If anything, Amazon is successfully showing retailers what’s possible when they fully integrate their mobile app experiences, e-Commerce infrastructure and store-level inventory information. Imagine a convenience store using this type of experience as an incentive for consumers to download their app. Folks who just want to get in and out as quickly as possible can do so with ease and, ultimately, the store’s app downloads increase significantly. But I think the key point to take away here is an experience like this isn’t completely logical for all retail categories. So the fact is the demand for valuable store associates will never go away. I would even argue that this technology would actually support employees — rather than hinder them or eliminate their purpose. It’s still too early to tell how this trend will impact the retail industry as a whole, but it’s clear that Amazon has once again successfully encouraged retailers and consumers to rethink retail as we know it.
Klaudia Tirico, Features Editor: Amazon Go: What a time to be alive! Whether or not this new, mind-blowing endeavor will work is a question that can’t be answered yet. But, I am confident in saying that it probably won’t put an end to human cashiers. Retail is a huge landscape — from large home furnishing stores such as Nebraska Furniture Mart to small mom and pop shops — so there is plenty of room for retail associates to work alongside the next groundbreaking AI technologies. I personally don’t see this concept working for anything more than what the announcement video shows: A relatively small deli offering fancy juice and sandwiches. Just the thought of the “Just Walk Out” technology being implemented at Nebraska Furniture Mart makes me giggle. Imagine picking up a sofa and walking out with it on your back! But all jokes aside, Amazon Go does prove what technology in retail is capable of, and I think retailers would be silly to avoid it. One thing we can all learn from this is to reach for the stars because technology is getting to a point where nothing is impossible.
